JP Morgan heads exodus of firms quitting climate change group

TWO of the world’s biggest money managers have quit a major environmental coalition that pressures companies to take action on climate change over new rules deemed too radical.

JP Morgan’s fund management arm and State Street Global Advisors have both quit Climate Action 100+. Black

Rock, the world’s l argest money manager, is also reducing its participation in the group, the Financial Times has reported.

It is a significant blow for Climate Action 100+. The consortium of more than 700 global investors sets goals for its members aimed at cutting emissions.

By setting the same agenda for all fund managers, the group hoped to influence the activities of about 170 companies through combined voting power. The group’s ultimate aim is to reach net zero emissions by 2050, in line with the Paris Agreement goals.

The exits coincide with a move to a more activist stance taken by the group.

In its so-called Phase 2 stage, which will run until 2030, Climate Action 100+ is urging its members to vote against companies at annual meetings if management fails to do enough to meet climate goals. State Street told the Financial Times that Phase 2 went too far, saying it was “not consistent with our independent approach”.

JP Morgan Asset Management, which manages $3 trillion (£2.4 trillion), said it would pursue environmental goals on its own instead. A spokesman said: “JP Morgan Asset Management i s not renewing its membership in recognition of the significant investment it has made in its own investment stewardship team and engagement capabilities, as well as the development of its own climate risk engagement framework over the past couple of years.”

A spokesman for Climate Action 100+ confirmed the bank had left the initiative but declined to give more detail. They said: “Last autumn alone, more than 60 new signatories joined, and we expect interest to continue growing.”

Its members include the BBC pension scheme, Church of England pens i on f und a nd s e veral c ouncil retirement schemes. Climate Action 100+ claims to represent $68 trillion of fund manager assets globally.